Oklahoma Insurance Commissioner Glen Mulready on Nov. 26 authorized Rhode Island-based insurance Providence Washington Insurance Co. (PWIC) to submit its Insurance Business Transfer (IBT) Plan to the District Court of Oklahoma County for approval.
According to the Oklahoma Insurance Department, this is the first IBT approved by an insurance commissioner in the United States.
If approved by the Court, the IBT would transfer nearly all of the insurance and reinsurance business underwritten by PWIC to Yosemite Insurance Co., an insurance company in Oklahoma. The transfer would include the liabilities associated with those policies as well as $38.5 million from PWIC to Yosemite as consideration for assuming those liabilities.
The application filed by PWIC and reviewed by the commissioner and department staff includes the IBT Plan, extensive financial documents and a plan for how the transaction will be communicated to policyholders and other interested parties. It also includes a report from an independent expert who concluded that the proposed transaction will not have a materially adverse effect on policyholders and claimants of the companies.
Oklahoma’s IBT law became effective in November 2018. The Oklahoma process closely mirrors Part VII of the Financial Services & Markets Act of 2000 in the United Kingdom, which has resulted in nearly 300 successful transfers. This mechanism focuses on the protection of consumers while allowing insurance companies to strategically deploy assets to their areas of focus.
Source: Oklahoma Insurance Department
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